What are credit memos for?

Enter a credit memo/refund
to record a return when a customer returns items for which you have already
recorded an invoice, customer payment, or sales receipt. You can also use a credit memo as part of the process of handling a bad or bounced check from a customer.

If necessary, issue a credit card refund for the returned items.

When writing a
refund check to a customer, always complete a credit memo first so you can
track the sale, return, and refund correctly in QuickBooks.